Running a tea business: getting things done in China

Posted: March 16, 2012Daoli

When Miha and I were setting up the tea business we knew that it wouldn’t be a smooth road. However, I was sure that knowing Chinese and understanding how people think here, I should be able to avoid most of the trouble. In reality, however, there have been problems with every single teaware supplier almost every step of the way.

It’s much easier to buy tea than tea ware. I meet the farmer or trader, try the tea, ask about the price, negotiate if necessary, and just buy it right away. To buy teaware, I have to make dozens of phone calls, order samples, pay in advance, and then hope that I get exactly what I asked for and that I won’t have to send anything back.

I have to admit that I was lucky in the sense that no one simply took our money and disappeared. Most problems that I’ve had to deal with when getting things done in China were due to carelessness.

Glass mugs with logo

A typical example is our glass mug with filter. I’ve spoken to a lot of manufacturers and ordered quite a few samples in order to pick the right mug. Finally, I chose a factory that sent me some very nice samples and was willing to do a fair amount of customization. Once we agreed on the specs and the logo position (bottom of the cup), I wired them the 30% deposit and gave the green light. The cups were being made by hand one at a time, and I wanted several cups to be delivered to me ahead of the remaining 200. I like using them myself and wanted to give a few to my friends. The factory said OK and sent me four cups with express mail. When I got the package, I was so happy that I took a few pics and sent them to Miha. Later that day, he made a comment that the logo was upside down. I took another look at the mug and then it hit me: for the logo to read correctly the cup had to be held in the left hand…

The factory liaison acknowledged the blunder and promised to take care of the problem. It was bad news anyway because Chinese New Year was coming and I knew that we’d have to wait for another month until at least some of the workers get back to the factory. Because of low priority that the factory assigned to redoing the cups, it actually took two months, and the work was completed just a few days ago. The mugs should get to Kunming in a day or two.

Gaiwan outsourcing gone terribly wrong

At roughly the same time, Miha and I were looking for someone who could make some nice gaiwans for us. There are thousands of factories that make ceramics, but only a few would agree to make fifty customized pieces. Eventually, we found a manufacturer who said that he was up to the task. The price wasn’t low but still reasonable. The guy insisted on getting all the money in advance, to which I was soft enough to agree. About one week later I got an email from him saying that the cups were ready and that they were already sent to my address in Kunming. However, he added that instead of red gaiwan I’d be getting them in white, because the factory to which he’d outsourced the work said that it was easier to use white colour. I sent them the red logo, but instead of tweaking it a bit, they changed the color of the whole set.

My first reaction was WTF?! I called the guy and he explained that the factory to which he outsourced the task made the change without telling him first, and so it wasn’t his responsibility. I told him very politely that it was unacceptable and that I expected a full refund. I wrote him a follow-up email repeating my concerns. I think he blacklisted me on his phone because I wouldn’t even get to the waiting tone. There was no response. Fortunately, his website was hosted on the servers of a larger organisation and I was able to use appeal to their support team. A few days later the goods arrived and I filed an official complaint. He called me the same day, saying that all that time he was in the countryside and that the signal was very bad. He said that he’d give me a refund after I sent back the goods. The lady from the support centre said that that was the way to go, so I sent back the parcel. Two days later, the express delivery service called me saying that the guy refused to receive the goods because he didn’t want to pay for shipment.

The complaint supervisor called him again and tried to talk some sense into him, but, apparently, the man got hysterical and said he didn’t mind if his account was deleted all together. So I paid for the shipment. A few more days passed and the support team called me saying that he wanted to only give me half of the money back, because many gaiwans got damaged. The following day, the mail people called me up with some questions. Apparently, the man had told them that only five (out of 50) gaiwans were broken. I told the support team about this, and they were able to get him to give me back 80% of the money. They also promised to flash a warning message on his account page.

Portable tea sets

About a year ago, I came across a very nice portable tea set in a Kunming tea market. I knew right away that it would be perfect for the Daoli selection. I asked if the shop owner could put me in touch with the manufacturer. Of course, the answer was a polite no. There was a logo in Chinese on the tea set holder, so I searched for it online and found their webpage. I called a few numbers asking for prices, MOQ (minimum order quantity), etc. and was redirected to someone else. The man who spoke to me next realised that I was a foreigner and gave me another phone number. I thought I’d be talking to his English-speaking colleague. However, it turned that he gave away the number of their original supplier. In other words, he generously helped my bypass two middlemen, himself included!

This new manufacturer proved to be very flexible and forthcoming. The fact that I was finally able to use video chat for negotiations was particularly helpful and encouraging. I told them that I just needed the daoli logo on the bottom of every single piece and some extra padding between the water bowl and the lid. They said no problem and asked for 30% deposit. To make the long story short, the 200 tea sets arrived in seven boxes a few weeks later. The extra padding that they promised to include proved to be a double piece of very thin fabric that was just useless. Needless to say, quite a few sets were broken. It was the Chinese New Year time, so I had to wait for a few weeks before I was able to get a hold of the right people. I sent them some pics showing the damage and asked them “Where’s my padding?!” The answer was something like “This is how we always send it around China. Talk to the boss if you have any questions. Here’s the number bla-bla-bla”. The boss turned out to be a reasonable lady. She got somewhat upset at first but later just told me to give her the final count of the damaged items so that she could send me some of the money back. That’s it! No one cares if, in the end, I’m getting 150 sets instead of 200.

Tea set packaging

This one is a true classic. I have a friend in Kunming who runs a small print shop. He’s already printed stickers and flyers for us, so I knew that I could trust him with bigger things too. I showed him the tea set and explained that we needed a nice, strong, and well-padded box for it. It took about a week to agree on the design and materials. By that time, I had decided that I’d never OK production without seeing a complete sample first. Qiao (my friend’s name) said that it would cost a lot to make just one box, but I explained that it was the only way to avoid problems and he seemed to agree. Knowing that he is very busy, I decided to call him every two days. This way I could check on the progress and get a chance to remind him about the need to make the sample first.

A few days later, Qiao informed me that the first box was ready and that he would show it to me the next day. As soon as I opened the door and saw an awkward smile on his face, I knew that something went wrong. Structurally, the box was everything I wanted it to be. The quality of the print was very good too. However, the original plan was to have the logo printed in a continuous tape-like fashion on all four sides of the box. His employee messed up the placement, so now, when the box is closed, the logo is only visible on two sides. Where did the other two go? Well, they ended up on the inside of the box :-)

Who’s the boss?

We then sat down in my living room and I made two big mugs of strong shu pu’er for us. I told him that it wasn’t a big deal, since it was only a sample. He sipped some tea, sighed deeply, and said that he had 250 of these boxes ready. Then it was my turn to sip some tea and sigh deeply. I was just about to ask why he didn’t make one sample first, but he anticipated my question saying that the sample would cost 60 euros and he’d rather drive down the final cost for me.

I realised that we’d never actually had tea together. Whenever Qiao comes to my place, it’s always quick and businesslike. But that day was different. I talked about the problems that I’ve had to deal with since we started the tea business. And Qiao talked about his early years in Kunming, when he and his brother came here from a village in North-Eastern China. They only had 2000 RMB (approx. 300 euros) and spent all that money very soon. There was a period of time when they could only afford to have one meal per day. Now they are both running their own print shop. They did well for themselves, despite the unprivileged background. Most of his employees come from similar backgrounds so he understands them quite well. In this particular case, he told, it would do absolutely no good to fine or otherwise penalize the person responsible for the mistake. In China, people often quit their jobs in situations like that, in which case companies can lose even more money because there’s no one to do the work. He brought up an interesting Chinese expression that is sometimes used to describe situations like that: 工人是爷爷, 老总是孙子. It literally means the employee is the grandfather, the boss is the grandson.

On that note, we agreed that he would try to take care of the blank sides of the boxes and that we would meet again several days later. Hopefully, things are going to work out next time.